As Jose Luis Obregon, managing director of the Hass Avocado Board, cleared out his desk and prepared for his next career challenge, he boldly predicted that the U.S. market will consume 2 billion pounds of Hass variety avocados annually within four years.
“If we can maintain the same growth we have had over the past decade, we will hit 2 billion pounds in four years,” he said utilizing the possessive pronoun, although his last day at his post with the industry association was to be Friday, Oct. 28.
And the numbers show he is likely correct.
In 2000, the U.S. market consumed 550 million pounds of Hass avocados; six years later consumption doubled, and 1 billion pounds was eclipsed.
The comparison is somewhat misleading since 2000 was a down year; the industry had topped the 550 million-pound mark multiple times in the previous 15 years.
Nonetheless, consumption has been on a tremendous upward trend for the last decade, with Mr. Obregon calculating it at an average rate of 10 percent per year. Last year was a banner year with a total of 1.35 billion pounds of Hass avocados sold in the United States. This year (2011) will be slightly less because both the United States and Chile had down years in terms of production.
Mr. Obregon said that when the calendar year is complete, he expects there to have been about 1.2 billion pounds of avocados consumed in what he termed a “short crop” year, chuckling at that characterization.
For 2012, HAB has estimated that Mexico will send 700 million pounds of Hass avocados to the United States, followed by 400 million pounds from California, 250 million pounds from Chile, 75 million from Peru and another 15 million from the “other” category, which includes New Zealand and the Dominican Republic. That totals 1.44 billion pounds and does not even include other varieties of avocados, such as the more than 50 million pounds of the tropical varieties produced in Florida and the Caribbean.
“I truly believe that we have huge growth potential ahead of us,” said Mr. Obregon. “There is so much untapped growth out there — especially on the East Coast.”
Mr. Obregon said that while the per-capita consumption of avocados in the United States is about 4.4 pounds, the vast majority of that consumption comes from the western half of the United States, where far fewer people live.
“Two-thirds of our consumption is west of the Mississippi [River], where one-third of the population lives,” he said. “So two-thirds of the people eat only one-third of the avocados. If we could get those two-thirds to eat the same amount, we wouldn’t have enough avocados to fill demand.”
Consumption of avocados east of the Mississippi River has grown significantly in recent years as volume and promotion dollars have increased. California, Chile and Mexico run their own promotional campaigns in partnership with HAB, utilizing some of the assessment dollars collected by that group.
Mr. Obregon said that the 2012 crop should bring in more $35 million in assessments at the 2.5 cents per pound rate. “With the bigger crops the industry has more money to promote, and we can continue to grow consumption,” he said.
In 2012, the job of managing the Hass Avocado Board will be turned over to someone new.
“We hired Mixtec (an industry executive search firm) to find a replacement for me, and they are currently interviewing candidates.” Mr. Obregon said. “The board expects to have a new person in by December 1.”
After more than six years with HAB, including four years as the top staff person, Mr. Obregon is joining his brothers in their Nogales, AZ-based produce company, which imports and sells fresh produce.
Mr. Obregon has become a partner in IPR Fresh and has been named the firm’s president.
“I am going to become a fruit peddler,” he joked, adding that his goal is to focus on growing the company and “taking it to the next level. Everyone has cycles in their lives and after six-and-a-half years, I wanted to do something different and more on my own.”
Mr. Obregon said that he would be relocating his family to the Nogales area over the next several weeks to begin his new position by the middle of November.